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UK House Prices Fall For Sixth Month
Written by Saumyatanu   
Monday, 27 December 2010 06:32

UK House Prices Fall For Sixth Month




(Forex News) - House prices in England and Wales fell for a sixth month in a row in December as demand continued to slump, a new survey showed on Monday.

The average cost of a home fell by 0.4% from November, reports said citing property intelligence group Hometrack. This followed a 0.8% decrease in the previous month.

Demand for homes fell for the sixth consecutive month, with estate agents reporting a 4.8% fall in the number of people registering in December.

House prices in England and Wales fell 1.6% in the whole year, Hometrack said. The group added that further price falls of 2% over 2011 were likely given poor demand and the government's spending cuts.

The number of properties coming on to the market increased 24% during 2010, while the number of people registered with real estate agents fell 7%.

"We expect house prices to remain under downward pressure in the first half of 2011 on the back of weak demand although we expect the supply of homes for sale to shrink as vendors withdraw from the market or reduce pricing to a level where property will sell," Hometrack director of research Richard Donnell was quoted as saying.

Meanwhile, a survey from the British Retail Consortium showed nearly two-thirds of retailers expect sales to worsen compared with 2010, with the rise in the VAT rate and public spending cuts expected to hit consumers' pockets.

But the group said retailers had more faith over their long-term prospects, with more investment and hiring planned for 2011.

BRC director general Stephen Robertson said highstreet sales are likely to be slightly higher this December than in 2009 despite the freezing winter weather.

"Despite the combination of snow and concerns about their money and job prospects, most customers were still determined to buy the things they wanted for Christmas and did seize the opportunities they had to shop," Robertson said.

"The disruption won't have helped sales but my hope is that the overall impact will turn out to be less severe than some fear."

by Forex Staff Writer